Steady 4.5% growth rate for print ad spends in 2017: GroupM report

GroupM, the leading global media management investment conglomerate, today released their biannual advertising expenditure futures report ‘This Year Next Year’ (TYNY) 2017, forecasting India’s advertising investment to reach an estimated Rs 61,204 crores in 2017. This represents a growth of 10% for the calendar year 2017 over the corresponding period in 2016.

CVL Srinivas, CEO, GroupM

Speaking about the report, CVL Srinivas, CEO, GroupM south asia said, “Despite a volatile 2016, we are estimating advertising expenditure growth at 10% in 2017. The first quarter will give a slow start to the year, with the market picking up from March-April, fueled by a stable recovery process post demonetisation. Sectors that are contributing to this positive trajectory include auto, media and e-wallets. In addition government and political parties will increase spending with elections in several states this year.”

“Digital is leading the adex growth with a 30% growth, while TV continues to be the largest medium in the mix. Print continues to grow at a stable rate of 4.5% and is still the second largest medium in the adex,” he added.

As per GroupM, the ad spending in 2016 was Rs 55,671 crores.

Looking at the advertising industry worldwide, GroupM estimates the global advertising expenditure (adex) to grow by 4.4% and Asia-Pacific to grow by 6.3%. With an estimated adex growth of 10%, India remains one of the fastest growing ad markets globally. While 80% of incremental ad spend growth in major markets comes from digital media, in India the numbers are more evenly split between traditional and digital media. Digital media accounts for about 40% of the incremental ad spend growth.

2017 is estimated to be a modest year for newspapers with 4.5% growth. The increase in ad spends expected from print heavy sectors like auto, BFSI, e-wallets will contribute to this growth. Vernacular and regional newspapers will see a higher growth rate. Digital, TV and radio are expected to grow at a rate of 15.5%, 8% and 10% respectively.

Other media such as OOH will witness good traction from sectors addressing rural audience and premium niche audience. As per the trend in recent years, Ccnema advertising will grow at a high double digit rate of 20%. Cinema consolidation has led to investments in infrastructure, this coupled with the growing acceptance of premium Indian and Hollywood content by advertisers augurs well for the medium.

TV's share reduces to 45 pc of all revenue, print stays at 30 pc, digital is at 15 pc.

Press will see a growth of 4.5 per cent this year and will continue to be the second highest contributor in terms of share of spends. The medium grew at 4 per cent last year according to the report. It expects growth to come from increase in ad spends from print heavy sectors like auto, BFSI and e-wallets.

Local and regional newspapers will see a higher growth rate. The total contribution of print is estimated at Rs 18,258 crore.

India is the only market among Russia, China, UK, USA, Brazil and Germany in which press continues to grow.

The fourth edition of GroupM's annual 'This Year Next Year' (TYNY) report predicts advertising to grow by 10 per cent to reach Rs 61,204 crore this year.

According to the report, ad spends for 2016 were Rs 55,671 crore (12 per cent growth from 2015), compared to predicted spends of Rs 57,486 crore at the start of last year.